GLOBAL E SERVICES PVT. LTD.,MUMBAI vs. DCIT 9(1) (ERSTWHILE) ACIT 12(2)(2) (PRESENT), MUMBAI

Q: Which sections of the Income-tax Act were involved?

Section 143(3), Section 158A(1)

ITA 2212/MUM/2016Status: DisposedITAT Mumbai02 January 2017AY 2011-122 pages

In favour of the Revenue: the assessee's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal dismissed the assessee's appeal, directing the AO to apply the decision of the Bombay High Court once it is pronounced, even though the assessee did not prefer an appeal for this specific assessment year.

What were the facts?

The assessee claimed depreciation on buildings used for an IT park and call center, but the AO disallowed it as the buildings were shown as stock-in-trade. The assessee had a similar issue pending before the Bombay High Court.

What were the issues?

Whether depreciation is allowable on buildings treated as stock-in-trade. The applicability of a pending High Court decision to the current assessment year via a declaration under Section 158A(1).

Which sections of the Income-tax Act were involved?

Section 143(3),Section 158A(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH, MUMBAI

For Appellant: Ms. Nimisha Bothra, AR, Shri. M.V. Rajuguru, Sr. DR

IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, MUMBAI BEFORE SRI MAHAVIR SINGH, JM AND SRI N.K. PRADHAN, AM (A.Y:2011-12) Global E Service P. Ltd. Dy. Commissioner of Income Tax C/o D.C. Bothra & Co. (CA) 297, 9(1)A.C.I.T. 12(2)(2), Room No. Tardeo Road, 1st Floor Willie 145, 1st Floor, Aayakar Bhavan, Vs. Manison, Opp. Bank of India, M.M. Road, Mumbai-400020 Nana Chowk, Mumbai-400007 PAN No.AAACT5168P .. Appellant Respondent Assessee by .. Ms. Nimisha Bothra, AR .. Shri. M.V. Rajuguru, Sr. DR Revenue by Date of hearing .. 02-01-2017 .. Date of pronouncement 02-01-2017 O R D E R PER MAHAVIR SINGH, JM:

This appeal by the assessee is arising out of the order of CIT(A)-20, Mumbai, in appeal No. CIT(A)-20/DCIT 12(2)(2)/IT-108/2013-14, Mumbai dated 04-12-2015. The Assessment was framed by DCIT-9(1), Mumbai for the A.Y. 2011-12 vide order dated 30- 12-2013 u/s 143(3) of the Income Tax Act, 1961 (hereinafter ‘the Act’).

At the outset, the learned Counsel for the assessee stated that on the similar issue in A.Y. 2005-06, the question of law is admitted and is pending before the Hon’ble Bombay High Court on an appeal filed by assessee u/s 260 A of the Act and also for earlier and subsequent assessment years. The relevant substantial question of law admitted by the Hon’ble Bombay High Court reads as under: -

“Whether on the facts and in the circumstances of the case and in law, Tribunal was justified in upholding the order of the CIT(A) and the AO is not allowing the appellant’s claim of depreciation of Rs.9,12,064/- on buildings owned by the appellant and used for the purpose of the business of running of I.T. park and an international call Centre only because the slid buildings were shown as shown as stock-in-trade in the books of accounts?” In similar circumstances, according to the learned Counsel the Tribunal in for the A.Y. 2002-2003 has decided the issue against the assessee but directed the AO that as and when the Hon’ble Bombay High Court decide the question of law pending before it, the same shall be applied in this year also, notwithstanding, that the Assessment Year: 2011-12 assessee does not prefer an appeal on the said question of law before the Hon’ble Bombay High Court for this year because the assessee has filed declaration u/s 158A(1) before the Bench which is placed on record. In term of the above, she requested that in this year also the appeal be dismissed subject to the decision of the Hon’ble Bombay High Court in term of Section 158A (1) of the Act. The Ld. Sr. DR has not objected to the same.

After hearing both the parties and going through the facts and circumstances of the case, we dismiss the appeal of the assessee but subject to the decision of the Hon’ble Bombay High Court, AO is directed to apply the decision of Hon’ble Bombay High Court in this year also, notwithstanding the fact that the assessee does not prefer the appeal on the said question of law before the Hon’ble Bombay High Court in this year. The appeal of the assessee is dismissed subject to the direction in terms of Section 158A (1) of the Act.

In the result, the appeal of the assessee is dismissed. Order pronounced in the open court on 02-01-2017.

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